NORTHWEST TERRITORIES – Avalon Rare Metals of Toronto says project construction costs will be $1.575 billion for the Nechalacho rare earth elements project at Thor Lake, 100 km southeast of Yellowknife. The recently finished feasibility study gave the project a pre-tax net present value of $1.351 billion and after-tax NPV of $900 million at a 10% discount.
The Nechalacho project would have several revenue streams. Estimated sales are $645.8 million per year, 70% from separated rare earth oxides (REO) and 30% from an enriched zirconium concentrate (EZC). More than half the revenue would be generated by the sale of heavy rare earth elements. Sales of neodymium, europium, terbium, dysprosium and yttrium will amount to 82% of the REO revenues. Lanthanum and cerium sales will amount to less than 4.5% of total revenues.
Avalon bases the initial 20-year mine life on probable reserves of 14.6 million tonnes at a production rate of 730,000 t/y. The company noted that measured and indicated resources as now estimated are sufficient for a mine life of 90 years.
Mining plans include establishment of a 2,000-t/d underground mine accessible via ramp to recover ore from the Basal zone for 20 years. Mechanized mining will be practiced with underground crushing and conveyor haulage to an on-site mill. A paste backfill plant will be built.
The ore will be concentrated in a flotation mill at Thor Lake, and the concentrates will be barged across Great Slave Lake to a hydrometallurgical plant at Pine Point, NT.
Detailed mining and milling plans are spelled out in the 2011 technical report posted at AvalonRareMetals.com.